CEOs Took a Massive Pay Cut Last Year

CEOs Took a Massive Pay Cut Last Year
Image credit: Bloomberg Bloomberg via Getty Images
Steve Ells

Grow Your Business, Not Your Inbox

Stay informed and join our daily newsletter now!
2 min read
This story originally appeared on Fortune Magazine

Last month, Fortune reported that the compensation of Chipotle co-CEOs Steve Ells and Monty Moran had been cut by more than half amid the burrito chain’s health scares.

It turns out they weren’t the only ones.

A new analysis by The Wall Street Journal shows that pay for CEOs of the largest U.S. companies plummeted last year. In fact, it saw the sharpest drop since the financial crisis as weaker corporate performance sacked cash bonuses and accounting regulation hampered pension growth.

At nearly 300 large public companies, median compensation for CEOs fell 3.8 percent last year, from $11.2 million to $10.8 million. Half of those executives saw their pay decrease or rise by less than 1 percent.

The decline is attributable, in large part, to slow growth in pension values -- tweaks to assumptions about interest rate and life spans had inflated them the prior year -- and underwhelming corporate performance. At the companies the Journal studied, shareholder return was flat in the year pay was reported versus 17 percent the year earlier.

There are some notable names who join Ells and Moran of Chipotle on the list of execs who saw their compensation decline. 3M CEO Inge Thulin’s pay fell 3.4 percent to $19.4 million. Johnson & Johnson’s Alex Gorsky’s $23.8 million represents a 4.8 percent hit. American Express CEO Kenneth Chenault received a 3.5 percent pay cut to $22 million, and the compensation of Hess Corp. CEO John Hess shrank by a staggering 42.7 percent from $22.5 million in 2014 to $12.9 million in 2015.

More from Entrepreneur
Entrepreneur Select: A Fund For Entrepreneurs, By Entrepreneurs

Entrepreneurs require more than just money, which is why we aim to empower you, as well as act as a catalyst for value creation.

Make sure you’re covered if an employee gets injured at work by
  • Providing us with basic information about your business
  • Verifying details about your business with one of our specialists
  • Speaking with an agent who is specifically suited to insure your business
Discover a better way to hire freelancers. From business to marketing, sales, finance, design, technology, and more, we have the freelancers you need to tackle your most important work and projects, on-demand.

Latest on Entrepreneur